Victoria’s Secret’s owner L Brands announced Tuesday that it plans to cut more than 800 corporate jobs as the economic downturn caused by the coronavirus pandemic affected business.
L Brands said in a release it plans to lay off 850 associates, amounting to about 15 percent of the corporate workforce, as part of a series of cost-saving measures. The cut employees will receive a “comprehensive benefits package,” including severance, continuing access to health care and outplacement services.
The company is expecting to save $400 million from the cost-cutting measures and predicts it will end the fiscal year with $175 million in savings. L Brands said it forecasts pre-tax severance costs for the layoffs to cost about $75 million.
“Decisions relating to our workforce are incredibly difficult and not taken lightly, but these actions are necessary to best position our company for the long-term,” L Brands CEO Andrew Meslow said in a statement. “On behalf of the Board and management team, I’d like to extend our deepest appreciation to the impacted associates for their contributions and dedication over the years.”
L Brands reported most of its North American stores have reopened after the shutdown, but the company previously announced in May it would permanently close about 250 Victoria’s Secret and Pink stores in the U.S.
The company forecasts its total net sales for the second quarter to be about 20 percent lower than in 2019. Bath & Body Works, which it also owns, did see about a 10 percent increase in sales, but Victoria’s Secret dealt with a 40 percent decrease compared to last year.
The firm’s latest annual filing showed the company employed about 94,400 people, with 68,900 of those being part-time workers, CNBC reported.